General Electric Co. announced on Thursday that it will be laying off 12,000 jobs at its global power business. The action reflects the company’s latest effort to turn itself into a more focused company with a smaller number of employees.
GE’s largest business in revenue and number of employees is its producer of turbine for coal and gas-fired power plants.
The move came as newly appointed CEO John Flannery tries to get the U.S. industrial giant back on track. This follows last month’s feat wherein the company halved its dividend while also lowering profit targets.
“This decision was painful but necessary for GE Power to respond to the disruption in the power market, which is driving significantly lower volumes in products and services,” said GE Power chief executive Russell Stokes in a statement. He then added that the company expects for the challenges to continue.
According to GE, the cuts “are driven by challenges in the power market worldwide.” They also said that softening markets like coal and gas were also part of the reason. As the renewable energy continues to grow, so does GE’s struggle to compete.
The layoffs will be affecting the GE facilities outside the U.S. first. This is due to hopes that it can reduce overall structural costs by US$3.5 billion in 2017 and 2018.
The cuts represent around 4 percent of its entire workforce. According to its corporate website, GE had about 295,000 employees as of December 2016.
GE Power is responsible for producing gas production systems and steam turbines, among other things. It would then sell them to different utilities and industries.
GE Shares Sold
KBC Group NV sold 27.5 percent of its shares of GE during the second quarter. This is due to its latest 13F filing with the Securities and Exchange Commission.
The institutional investor owned 2,474,321 shares of GE after it sold 938,391 shares during the quarter.
GE makes up around 0.6 percent of KBC Group NV’s holdings, placing it as the latter’s 24th biggest holding. According to KBC’s recent SEC filing, its holdings in the multinational conglomerate corporation amount to $66,831,000.
Other large investors that have bought and sold GE shares include: Ullmann Financial Group Inc., PHH Investments Ltd., Barber Financial Group Inc., Flaharty Asset Management LLC, and Oakmont Partners LLC.
BWorldFinance is your primary source of news in the financial market, technology, and more. Visit bworldfinance.com now and get the latest happenings on the market.